The Government has proposed legislation which would extend compulsory motor insurance, as provided for under the Road Traffic Act 1988, to cover product liability for motorists using autonomous vehicles.

The legislation will mean that a single insurer will insure both the driver’s use of the vehicle and the automated vehicle technology.

Transport Secretary Chris Grayling said: “Automated vehicles have the potential to transform our roads in the future and make them even safer and easier to use, as well as promising new mobility for those who cannot drive. But we must ensure the public is protected in the event of an incident.”

There had been concern that confusion would arise if there was an incident involving an autonomous vehicle as to who to pursue, the driver or the manufacturer, which in turn would lead to a delay in innocent parties receiving compensation.

The Government is therefore introducing legislation “to ensure that motor vehicles continue to be properly insured, and innocent victims of collisions involving automated vehicles are compensated quickly.”

When a crash is determined to have been caused by an automated vehicle the victim will have a direct right against the insurer. The insurer will in turn have a right of recovery against the responsible party, which could include the manufacturer of the vehicle.

This news came shortly before Ford announced that it is investing $1bn into AI development over the next five years.

Ford intends to have a fully autonomous, level 4-capable vehicle for the commercial market by 2021. This means its vehicles won’t have a brake pedal, accelerator, or steering wheel and will be able to operate in a predetermined geographical area without human intervention. This, according to the Society of Automated Engineers (SAE), is one rank behind “fully autonomous”, in which the AI is able to fully control every aspect of the driving and does not rely on the input of a human driver.

Ford CEO Mark Fields told Business Insider: “The term autonomous vehicle is just thrown about so liberally in this industry. I mean, there are five levels of autonomy… My only fear in the industry is somebody tries to come out with one of those [self-driving cars] before it’s ready and then there’s an event.”

The Government’s proposed legislation appears to be sensible in order to swiftly deal with such an “event” should one occur.